What Elena Kagan's Confirmation Reminds Me Of
This afternoon, the Senate confirmed Elena Kagan to serve on the Supreme Court by an unambiguous vote of 63-37, with 56 of 57 Democrats voting in favor (moderate Ben Nelson voted "no"), both Independents (the sometimes liberal Joe Lieberman and the always liberal Bernie Sanders) voting in favor and 5 of 41 Republicans voting in favor (moderates Collins, Snowe, Graham and conservatives Lugar and Gregg.) It was not a particularly close vote, even by the defacto 60 vote threshold that we have come to know and hate in the US Senate.
Her joining of the court will not much change the ideological make-up, given that she replaces the most liberal member of the court, John Paul Stevens.
In Kagan, the country gets a great legal mind, but one with limited judicial experience. Depending on your perspective and the year, that is either a good thing or a bad thing.
I was reminded by a liberal friend of mine the other day just how much Supreme Court seats punctuate how much consequence each Presidential election holds. He reminded me of the closeness of the 2004 Presidential race (3 points nationally, less than a hundred thousand deciding votes in Ohio) and the fact that the seat, in effect, decided two Supreme Court seats, those now held by Samuel Alito and John Roberts, probably for at least a generation.
How different would the nature of court decisions be if there were a solid 6-vote liberal majority versus a moderate/conservative 5-4 majority?
Is He Keeping His Promises?
There's been a lot of discussion in the space lately about President Obama's declining approval ratings, but I haven't updated in a while how he is tracking on actually doing what he said he would do, that is, keeping his campaign promises.
From our friends at politifact, here is their latest accounting:
Promises Kept: 120
Promises Partially Kept (aka compromises): 38
Promises Broken: 20
All other promises (ones in the works, not yet rated or "stalled" - meaning that they are not progressing at the moment): 327
So, of the 505 things that President promised to do in the 2008 campaign, if I give him full credit for kept promises and half-credit for partially-kept promises, he has completed 27.5% of his promises, or given that his term is 38.5% completed, he would be on pace to fulfill 71% of his promises. Not a bad average, except that the promises get harder the further you get along, since early on you generally get all the early stuff done.
In terms of the promises in which he has taken definite action (the 178 rated), he has been 78% true to his word.
All of this leads me to conclude...we largely got what Obama said he would be. If we are disappointed, it is largely because we took it upon ourselves to believe he might be something he never said. I included myself in the deluded.
How About That Stimulus?
Quietly, having faded from public attention long ago, the American Recovery and Reinvestment Act continues to return tax dollars and spend money on infrastructure and entitlements. This is the problem with 3-year economic programs, like the stimulus bill -- people forget they are working long before their full effects are known.
By the latest government accounts,
Tax Cuts: $223B out of $288B spent (77% complete)
Spending: $268B out of $499B spent (54% complete)
The tax cuts largely expire at the end of this year, so those will be 100% complete by December. The infrastructure spending will certainly extend into 2011.
The ARRA, combined with the balance-sheet actions of the fed, have largely shaped economic policy in this country for the first Obama term. The results in 2012 will largely reflect whether these policies ultimately succeed or fail.
There have been some great pieces published of late that show just how closely Presidential results track to election-year income growth. I'll publish a recap of this work in my next blog, but suffice it say, it shows the Clinton campaign of 1992 was right, "it's the economy, stupid"
I Was Wrong on Laffer
In a recent blog about the history of the Laffer curve, I stated that Arthur Laffer now supported raising taxes as he believe that we were not past the optimal revenue point for taxation. My remarks were based on my recollection of a Newsweek article from several months ago. As I have been unable to locate the original source, and Mr. Laffer has made it clear in a subsequent Wall Street Journal commentary piece that he does not support raising top marginal tax rates, I apologize for misconstruing his views on present taxation.
I stand by my belief that tax rates need to be increased, but did not mean to misrepresent Mr. Laffer's view as being supportive of mine.
Showing posts with label Elena Kagan. Show all posts
Showing posts with label Elena Kagan. Show all posts
Thursday, August 5, 2010
Saturday, June 26, 2010
Obama Takes a Hit in the Gulf, The Insubordination of Stanley McChrystal, Weak Wall St Reform, Kagan Hearings Monday, Rock Star Haley
I have been somewhat derelict in my duties (such as they are) as a blogger the past couple of weeks. I've had a lot going on in my real life, having transitioned to a new job that has been consuming a large percentage of my time. To make up for my lack of coverage recently, this will be a long post to try to get caught up on the recent news. And there has been a lot.
Presidential Approval: Heading Into the Deep Sea
Gains that the President had made last month have been completely erased and he is at or near all-time lows in his Presidency. The past month has seen some interesting trending. The big one-day dip on June 14th likely has more to do with the timing of poll releases than with anything substantial (as his numbers recovered the next day), but the overall trend for the month is unmistakably down. Anger over the spill in the gulf, the White House's seeming slow response and the continued malaise in the U.S. economy is likely to blame.
After posting his first substantial monthly gain in his entire Presidency in May, President Obama is on pace to hit an all-time low in June, with an approve minus disapprove of +1.5%. One positive note for the President is that his numbers are still positive, a considerable feat given all the hits he has taken. Internals of the polls show that Democrats largely still approve of him (80% in the latest Gallup poll) and he is still holding on to about 4 in 10 Independents, while Republicans (85% in Gallup) almost universally disapprove. Obviously the Independents tend to be the ones that drive poll trends, given that the Democratic and Republican numbers seem fairly entrenched.
Good Riddance, General McChrystal
President Obama made the right call this week when he fired General Stanley McChrystal over a Rolling Stone interview where the General and his staffers mocked the Vice President, implied that the President didn't know what he was doing and mocked other civilian authority figures. The General's actions are an utter disgrace.
Let me be clear...I have no issue with criticism of the administration. Anybody who has read this space the past year and a half know that I'm not shy at criticizing President Obama and other Democrats when they are out of line, just as I took shots at President Bush and the Republicans when they were in power. I am a civilian. I am not in the government. In our great, free country, I'm free to say whatever I want about these politicians.
The military is different. Our constitution was designed with civilian leadership of the military for a very important reason: the preservation of Democracy demands that our elected, civilian officials control the machine of war, not un-elected military leaders. As such, we have created a clear divide...civilian leaders are elected to make the strategy calls, military leaders are there to execute the strategy. General McChrystal is entitled to his opinions. But he has two choices: keep his opinions to himself or leave the military and become a civilian commentator. He has no right to sit from a military office and take shots at his civilian bosses. And he did, unambiguously. He had to go.
President Obama clearly made a poor decision putting McChrystal in charge of the effort in Afghanistan. Lost in all the coverage was that McChrystal was the President's hand-picked leader. The President and Defense Secretary Gates should have done a far better job betting the General to ensure alignment, loyalty and judgement.
Kudos to Senators Lindsey Graham (R-SC) and John McCain (R-AZ) for immediately and clearly speaking out against McChrystal and in support of the President's authority. Support from the minority for the established chain of command is important and the bi-partisan support for this constitutional principle was crucial in establishing the credibility of McChrystal's firing. Their statements were principled and correct. Nice to see that for a change.
Financial Reform That Does Something, But Not Enough
I feel like a broken record. Every time a reform bill passes recently, I have the same view: there are some good things in it, but it does not go far enough. This pattern repeats with the conference report on financial reform that was released this week and will head to the House and the Senate for final votes in the coming weeks.
It places limit on banks owning hedge funds (limiting ownership to 3% of assets), establishes processes for orderly management of crises such as the financial meltdown of 2008 and establishes a consumer protection agency.
What it doesn't do is force the break-up of institutions that are "too big to fail". This situation reinforces backward incentives around risk-taking. It also does not separate commercial from investment banking, meaning that your banks deposits can still be invested in risky assets. It does not solve the implicit government backing of almost all mortgages through Fannie Mae and Freddie Mac and, in fact, leaves in place those sinkholes more or less as is.
Feels to me like we will be back to the table discussing this issue again the next time that there is a financial crisis. And there will be another. Asset bubbles happen and most recessions deal with their popping....Savings and Loans in the 90s, Technology in 2000 and Housing in 2008...we seem to have an asset bubble every 10 years or so. And since the reforms of the 30s and 40s we haven't made much progress in stopping them.
Let's hope this is a first step and not the final solution.
Kagan Confirmation Hearings to Begin Monday
The Senate Judiciary Committee hearings for nominee Elena Kagan begin on Monday. Kagan has been recently vetted by the Senate, and, barring any unforeseen new revelations, I expect relatively smooth sailing for Kagan. The days of Supreme Court nominees receiving 90+ votes in the Senate are long gone, to be sure....judicial ideology seems to be the primary source of votes these days versus qualification (this trend was started by Democrats in the 1990s and has no permeated both parties), but Kagan should easily get 65 votes or so on her final vote in the Senate. And no Republicans thus far have talked of even mounting a filibuster, although if new revelations put her ability to get 60 votes in doubt, there would undoubtedly be one.
Nikki Haley in 2012? 2016?
She came out of nowhere. A few months ago she was fourth in the polls, now she is the probable next Governor of South Carolina. Nikki Haley this week easily won the run-off for the Republican nomination for Governor in South Carolina, clearing a path for what should be a relatively easy general election victory in the heavily Republican state.
Haley's victory marks several firsts. She would be the first female governor of South Carolina. She would be the first Indian governor in the state (she is half Indian). And she is a potential rock star in the GOP.
She is female. She is attractive. She is well spoken. And she is an ethnic minority in a party that is short on minority stars (Louisiana Governor Bobby Jindal is the only other one that I can even name.)
She faced all kinds of opposition from the good old boy network in South Carolina. She faced ugly racism from within the party. She faced ugly accusations of infidelity (none proven, many clearly motivated by opposition to her candidacy and frankly, totally irrelevant to her qualifications as Governor.) She handled the heat with class.
There are already those talking about her as a potential national candidate in 2012 or 2016. While it is VERY early to make such predictions....she hasn't even won the election yet and we have no idea how effective she will be in governing, she quickly has joined a short list of potential new GOP stars that includes New Jersey Governor Chris Christie (who has stated he is not interested in national office), Florida Senate Candidate Mark Rubio (who may well lose to now-Independent Charlie Crist) and ex-Alaska Governor Sarah Palin.
Keep an eye on this gal....she may just be the real deal.
Presidential Approval: Heading Into the Deep Sea
Gains that the President had made last month have been completely erased and he is at or near all-time lows in his Presidency. The past month has seen some interesting trending. The big one-day dip on June 14th likely has more to do with the timing of poll releases than with anything substantial (as his numbers recovered the next day), but the overall trend for the month is unmistakably down. Anger over the spill in the gulf, the White House's seeming slow response and the continued malaise in the U.S. economy is likely to blame.
After posting his first substantial monthly gain in his entire Presidency in May, President Obama is on pace to hit an all-time low in June, with an approve minus disapprove of +1.5%. One positive note for the President is that his numbers are still positive, a considerable feat given all the hits he has taken. Internals of the polls show that Democrats largely still approve of him (80% in the latest Gallup poll) and he is still holding on to about 4 in 10 Independents, while Republicans (85% in Gallup) almost universally disapprove. Obviously the Independents tend to be the ones that drive poll trends, given that the Democratic and Republican numbers seem fairly entrenched.
Good Riddance, General McChrystal
President Obama made the right call this week when he fired General Stanley McChrystal over a Rolling Stone interview where the General and his staffers mocked the Vice President, implied that the President didn't know what he was doing and mocked other civilian authority figures. The General's actions are an utter disgrace.
Let me be clear...I have no issue with criticism of the administration. Anybody who has read this space the past year and a half know that I'm not shy at criticizing President Obama and other Democrats when they are out of line, just as I took shots at President Bush and the Republicans when they were in power. I am a civilian. I am not in the government. In our great, free country, I'm free to say whatever I want about these politicians.
The military is different. Our constitution was designed with civilian leadership of the military for a very important reason: the preservation of Democracy demands that our elected, civilian officials control the machine of war, not un-elected military leaders. As such, we have created a clear divide...civilian leaders are elected to make the strategy calls, military leaders are there to execute the strategy. General McChrystal is entitled to his opinions. But he has two choices: keep his opinions to himself or leave the military and become a civilian commentator. He has no right to sit from a military office and take shots at his civilian bosses. And he did, unambiguously. He had to go.
President Obama clearly made a poor decision putting McChrystal in charge of the effort in Afghanistan. Lost in all the coverage was that McChrystal was the President's hand-picked leader. The President and Defense Secretary Gates should have done a far better job betting the General to ensure alignment, loyalty and judgement.
Kudos to Senators Lindsey Graham (R-SC) and John McCain (R-AZ) for immediately and clearly speaking out against McChrystal and in support of the President's authority. Support from the minority for the established chain of command is important and the bi-partisan support for this constitutional principle was crucial in establishing the credibility of McChrystal's firing. Their statements were principled and correct. Nice to see that for a change.
Financial Reform That Does Something, But Not Enough
I feel like a broken record. Every time a reform bill passes recently, I have the same view: there are some good things in it, but it does not go far enough. This pattern repeats with the conference report on financial reform that was released this week and will head to the House and the Senate for final votes in the coming weeks.
It places limit on banks owning hedge funds (limiting ownership to 3% of assets), establishes processes for orderly management of crises such as the financial meltdown of 2008 and establishes a consumer protection agency.
What it doesn't do is force the break-up of institutions that are "too big to fail". This situation reinforces backward incentives around risk-taking. It also does not separate commercial from investment banking, meaning that your banks deposits can still be invested in risky assets. It does not solve the implicit government backing of almost all mortgages through Fannie Mae and Freddie Mac and, in fact, leaves in place those sinkholes more or less as is.
Feels to me like we will be back to the table discussing this issue again the next time that there is a financial crisis. And there will be another. Asset bubbles happen and most recessions deal with their popping....Savings and Loans in the 90s, Technology in 2000 and Housing in 2008...we seem to have an asset bubble every 10 years or so. And since the reforms of the 30s and 40s we haven't made much progress in stopping them.
Let's hope this is a first step and not the final solution.
Kagan Confirmation Hearings to Begin Monday
The Senate Judiciary Committee hearings for nominee Elena Kagan begin on Monday. Kagan has been recently vetted by the Senate, and, barring any unforeseen new revelations, I expect relatively smooth sailing for Kagan. The days of Supreme Court nominees receiving 90+ votes in the Senate are long gone, to be sure....judicial ideology seems to be the primary source of votes these days versus qualification (this trend was started by Democrats in the 1990s and has no permeated both parties), but Kagan should easily get 65 votes or so on her final vote in the Senate. And no Republicans thus far have talked of even mounting a filibuster, although if new revelations put her ability to get 60 votes in doubt, there would undoubtedly be one.
Nikki Haley in 2012? 2016?
She came out of nowhere. A few months ago she was fourth in the polls, now she is the probable next Governor of South Carolina. Nikki Haley this week easily won the run-off for the Republican nomination for Governor in South Carolina, clearing a path for what should be a relatively easy general election victory in the heavily Republican state.
Haley's victory marks several firsts. She would be the first female governor of South Carolina. She would be the first Indian governor in the state (she is half Indian). And she is a potential rock star in the GOP.
She is female. She is attractive. She is well spoken. And she is an ethnic minority in a party that is short on minority stars (Louisiana Governor Bobby Jindal is the only other one that I can even name.)
She faced all kinds of opposition from the good old boy network in South Carolina. She faced ugly racism from within the party. She faced ugly accusations of infidelity (none proven, many clearly motivated by opposition to her candidacy and frankly, totally irrelevant to her qualifications as Governor.) She handled the heat with class.
There are already those talking about her as a potential national candidate in 2012 or 2016. While it is VERY early to make such predictions....she hasn't even won the election yet and we have no idea how effective she will be in governing, she quickly has joined a short list of potential new GOP stars that includes New Jersey Governor Chris Christie (who has stated he is not interested in national office), Florida Senate Candidate Mark Rubio (who may well lose to now-Independent Charlie Crist) and ex-Alaska Governor Sarah Palin.
Keep an eye on this gal....she may just be the real deal.
Sunday, May 30, 2010
What a Mess in the Gulf, Kagan Hearings Set for July, At Long Last Some Action on Gay Rights, Another Incremental Jobs Bills
An Inept Response All Around
We are now over 40 days into the spill on a BP rig in the gulf that is spewing thousands of barrels of oil into the ocean every day and the sad reality is that we appear no closer to solving the issue than we were on day one.
The so called "top kill", an effort to pump heavy mud and solid material into the well to stem the flow of oil has failed and the next plan is a custom fitted cap to limit (but likely not eliminate) the flow of oil while a relief well is dug, which will take at least until August to complete.
Don't expect a full resolution to this spill, already the largest in United States history, until at least August or September, which means that this spill may wind up being 4 to 5 times larger than the horrific Exxon Valdez spill a generation ago. To make matters worse, while the Valdez was devastating to the Alaskan coast, the economic, social and ecological impact of a spill in the gulf is far worse. The entire gulf coasts economy will be impacted in huge ways: fishing will be badly damaged for at least a decade, tourism to the beaches will be destroyed and all of the dependent things in the local economy (fish processing, hotels, restaurants, you name it) will be devastated. The ecological damage will be immense, destroying scores of natural wildlife under suffocatingly thick oil. This is, to put it simply, quite possibly the worst ecological disaster in United States history.
And still the oil flows on. And I'm left with the question why?
I take a very simple view of this. There are only two possibilities. The first possibility is that regulations were utterly inadequate to prevent such a spill or to ensure that a contingency plan was in place to quickly solve it where it to occur. The second possibility is that the regulations existed but were not followed. In reality, it is probably a mix of those two categories, but the more information that I find out, the more it supports the first theory.
I'd never even heard of the Minerals Management Service prior to this spill, but the obvious coziness and outright corruption of that organization has now become clear. How is it possible that it did not require back-ups to a valve failing on oil rig designs? Can you imagine a nuclear power plant that wasn't required to build a back-up system if one part failed? How on Earth did inspections not reveal this kind of risk? The head of the MMS has been fired and that is a good start, but it is utterly insufficient. We basically have a complete failure of a regulatory scheme and a need to start over, with new people and with new authority. I'd start by replacing Ken Salazar, a nice guy who seems to care deeply about these issues, but not the kind of tough enforcer that you need to fix the broken system. Plus, what kind of message does it send if there is no accountability at the top in an instance like this?
The President has appeared weak-kneed and late to the game here. If BP didn't have a plan to quickly solve the issue, than the government should have. If it didn't, it should've been in their with all of its best resources, from day 1, running things. Where is the Army Core of Engineers? Where is the President's Science Advisor? Heck, where is the plan? Are we just going to try stuff and hope it works?
It has been speculated on the right that this is President Obama's Katrina. I'm not quite ready to go that far yet, but let's just say that I'm not at all satisfied with his handling of this crisis. It does not inspire confidence in how he would deal with a natural disaster like a hurricane. And my view of the supposedly smart people around him is heavily wounded.
Kagan Hearings to Begin in Late July
Elena Kagan's hearings to replace John Paul Stevens on the Supreme Court will begin in late July, according to the senior Democrats in charge in the Senate Judiciary Committee. Republicans are already complaining that this gives them insufficient time to prepare, which is of course, utter nonsense, since they fully vetted Kagan less than 2 years ago as solicitor general, but as I've pointed out several times over the past few months, is a complaint consistent with a strategy of running out the clock on the current Congress in the belief (almost certainly correct) that the GOP will control more seats in the next Congress. They will complain and the hearings will go ahead anyway. Kagan will be confirmed, barring some unlikely previously unknown damning fact. Her vote totals will look a lot like the vote totals to confirm her for solicitor general (that vote was 61-31.)
Rumors have swirled around Kagan's sexual orientation, given her middle age and the fact that she has never been married. I have no direct knowledge of whether Kagan is gay or not, but can only say that if she is, I would love for her to come out of the closet and be a role model for gay Americans. I think it would be fantastic to have an openly gay Supreme Court justice. However, I don't even know if she is, in fact gay and if she is, she seems to have shown a preference for keeping those matters private, as should be her right.
Americans Worst Case of Employment Discrimination May Soon End
The House has finally voted, as part of the large Defense Authorization Bill, to end the awful, discriminatory and bigoted policy of "don't ask, don't tell" in the United States Military, following a full military review and sign-off by both Secretary of Defense Robert Gates and the President. The House Amendment passed with only 5 GOP votes and 26 Democrats voting no, despite the fact that new polling shows 80% of Americans support allowing gays to serve openly (although, out of fairness, I'm sure that the numbers if you polled the enlisted military would be far lower.)
The same day, the Senate Defense Committee agreed to a similar amendment to the Defense Authorization, with all Democrats on the committee voting for it, joined by Republican Susan Collins of Maine (thank goodness for those last two remaining Republican moderates in the US Senate.)
The road is certainly not over. The House has passed its version of the Defense Authorization Bill, but the Senate must still pass it's version, then both houses pass a reconciled conference report on the bill before in can go to the President for signature. Following that, the military review must be completed and the sign-offs from Gates and Obama take place before the policy goes into effect.
Because of the delay above, I renew my call on President Obama to show some leadership and suspend prosecution of gay members of the military until this work is completed. It is a crime that we continue to discharge brave members of the armed services for no other reason than being gay. And it is a crime that 4 out of 5 Americans, including the majority in some very red states, now recognizes as wrong. The American people are progressing their thinking a lot faster than Washington is.
Another Do-Little "Jobs" Bill
There is little question that the American Recovery and Reinvestment Act (aka the Stimulus Bill) is the President's signature piece of economic policy in his first two years. A massive $787 billion collection of expenditures and tax cuts spread over the first three years of his term, is more or less defines his economic approach in his first term. The reality is that most of the spending associated with that bill, which has, in a lot of ways, faded from public attention, is yet to take place. Here are the latest stats on the spending associated with the bill:
Spending: $236B out of $499B (47% complete)
Tax Cuts: $163B out of $288B (56% complete)
Total: $399B out of $787B (51% complete)
That's right, the stimulus bill is just barely half executed. And it was designed that way, not just as a short-term shot in the arm (which is what people typically think about when they think stimulus), but as a multi-year, multi-tiered approach to driving economic growth. Big tax incentives on the front-end for things like Cash for Clunkers or the First-Time Homebuyer Tax Credit to spur sales of cars and homes. By the way, remember how everyone on the right said Cash for Clunkers simply pulled forward sales that would have otherwise occurred later an that the auto industry would be back in the doldrums after it expired? Checked the stats lately? Auto sales are now up 25% year over year WITHOUT the credit. So, it's hard to argue the effectiveness of the short-term incentives.
Tier two was infusions of entitlements and state cash to stave off massive state budget cuts that would drive unemployment and to put cash in the hands of the unemployed and needy that would immediately be reinserted into the economy driving growth. This stage has had mixed success, with states staving off cutbacks....until now that the money is running out. Perhaps the money served it's purpose by saving those cuts until the economy was on more solid footing, but there is no doubt that there are state budget crisis everywhere right now that have to be solved.
The third stage, which we are really now entering in earnest is about infrastructure spending. Road and bridge upgrades. Green energy programs. Things which create jobs but are also investments in the future of our economy. There is road work upgrading I-295 near me (a badly needed project.) Solar panels have gone up on light poles all around me, provided by private industry, but subsidized by stimulus funds. This is all good stuff, whether or not it is enough to immediately bring down the unemployment rate. In fact, my criticism at the time is that I wished far more of the bill were devoted to infrastructure spending (only $275B out of the $787B packaged was devoted to such items, scarcely over a third.)
So with a clear approach already laid out and in progress, why is congress passing silly little $48B (and yes, $48B is tiny in the scheme of our economy) jobs bills? Because they are trying to show that they are doing "something" about the persistent near 10% unemployment rate and the 8+ million jobs lost in the recession. The truth is that the latest bill, a collection of small tax cuts which is about 50% offset by some tax hikes, does little either way to impact the economy. But it looks like action. And as mad as people still are about unemployment, they want to show some action.
The latest "jobs bill" is a small aside that will be quickly forgotten. But, keep the faith, unemployment will come down. The fundamentals are returning to the economy, with economic growth taking place and good employment growth over the past two months, for the first time since the recession started. But it is now obvious to me that it will take a painfully long time to get down to an acceptable level of unemployment (I define "acceptable" as somewhere around 7%, "good" as somewhere around 5%.) We'll see if the American people have that kind of patience. I suspect not.
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We are now over 40 days into the spill on a BP rig in the gulf that is spewing thousands of barrels of oil into the ocean every day and the sad reality is that we appear no closer to solving the issue than we were on day one.
The so called "top kill", an effort to pump heavy mud and solid material into the well to stem the flow of oil has failed and the next plan is a custom fitted cap to limit (but likely not eliminate) the flow of oil while a relief well is dug, which will take at least until August to complete.
Don't expect a full resolution to this spill, already the largest in United States history, until at least August or September, which means that this spill may wind up being 4 to 5 times larger than the horrific Exxon Valdez spill a generation ago. To make matters worse, while the Valdez was devastating to the Alaskan coast, the economic, social and ecological impact of a spill in the gulf is far worse. The entire gulf coasts economy will be impacted in huge ways: fishing will be badly damaged for at least a decade, tourism to the beaches will be destroyed and all of the dependent things in the local economy (fish processing, hotels, restaurants, you name it) will be devastated. The ecological damage will be immense, destroying scores of natural wildlife under suffocatingly thick oil. This is, to put it simply, quite possibly the worst ecological disaster in United States history.
And still the oil flows on. And I'm left with the question why?
I take a very simple view of this. There are only two possibilities. The first possibility is that regulations were utterly inadequate to prevent such a spill or to ensure that a contingency plan was in place to quickly solve it where it to occur. The second possibility is that the regulations existed but were not followed. In reality, it is probably a mix of those two categories, but the more information that I find out, the more it supports the first theory.
I'd never even heard of the Minerals Management Service prior to this spill, but the obvious coziness and outright corruption of that organization has now become clear. How is it possible that it did not require back-ups to a valve failing on oil rig designs? Can you imagine a nuclear power plant that wasn't required to build a back-up system if one part failed? How on Earth did inspections not reveal this kind of risk? The head of the MMS has been fired and that is a good start, but it is utterly insufficient. We basically have a complete failure of a regulatory scheme and a need to start over, with new people and with new authority. I'd start by replacing Ken Salazar, a nice guy who seems to care deeply about these issues, but not the kind of tough enforcer that you need to fix the broken system. Plus, what kind of message does it send if there is no accountability at the top in an instance like this?
The President has appeared weak-kneed and late to the game here. If BP didn't have a plan to quickly solve the issue, than the government should have. If it didn't, it should've been in their with all of its best resources, from day 1, running things. Where is the Army Core of Engineers? Where is the President's Science Advisor? Heck, where is the plan? Are we just going to try stuff and hope it works?
It has been speculated on the right that this is President Obama's Katrina. I'm not quite ready to go that far yet, but let's just say that I'm not at all satisfied with his handling of this crisis. It does not inspire confidence in how he would deal with a natural disaster like a hurricane. And my view of the supposedly smart people around him is heavily wounded.
Kagan Hearings to Begin in Late July
Elena Kagan's hearings to replace John Paul Stevens on the Supreme Court will begin in late July, according to the senior Democrats in charge in the Senate Judiciary Committee. Republicans are already complaining that this gives them insufficient time to prepare, which is of course, utter nonsense, since they fully vetted Kagan less than 2 years ago as solicitor general, but as I've pointed out several times over the past few months, is a complaint consistent with a strategy of running out the clock on the current Congress in the belief (almost certainly correct) that the GOP will control more seats in the next Congress. They will complain and the hearings will go ahead anyway. Kagan will be confirmed, barring some unlikely previously unknown damning fact. Her vote totals will look a lot like the vote totals to confirm her for solicitor general (that vote was 61-31.)
Rumors have swirled around Kagan's sexual orientation, given her middle age and the fact that she has never been married. I have no direct knowledge of whether Kagan is gay or not, but can only say that if she is, I would love for her to come out of the closet and be a role model for gay Americans. I think it would be fantastic to have an openly gay Supreme Court justice. However, I don't even know if she is, in fact gay and if she is, she seems to have shown a preference for keeping those matters private, as should be her right.
Americans Worst Case of Employment Discrimination May Soon End
The House has finally voted, as part of the large Defense Authorization Bill, to end the awful, discriminatory and bigoted policy of "don't ask, don't tell" in the United States Military, following a full military review and sign-off by both Secretary of Defense Robert Gates and the President. The House Amendment passed with only 5 GOP votes and 26 Democrats voting no, despite the fact that new polling shows 80% of Americans support allowing gays to serve openly (although, out of fairness, I'm sure that the numbers if you polled the enlisted military would be far lower.)
The same day, the Senate Defense Committee agreed to a similar amendment to the Defense Authorization, with all Democrats on the committee voting for it, joined by Republican Susan Collins of Maine (thank goodness for those last two remaining Republican moderates in the US Senate.)
The road is certainly not over. The House has passed its version of the Defense Authorization Bill, but the Senate must still pass it's version, then both houses pass a reconciled conference report on the bill before in can go to the President for signature. Following that, the military review must be completed and the sign-offs from Gates and Obama take place before the policy goes into effect.
Because of the delay above, I renew my call on President Obama to show some leadership and suspend prosecution of gay members of the military until this work is completed. It is a crime that we continue to discharge brave members of the armed services for no other reason than being gay. And it is a crime that 4 out of 5 Americans, including the majority in some very red states, now recognizes as wrong. The American people are progressing their thinking a lot faster than Washington is.
Another Do-Little "Jobs" Bill
There is little question that the American Recovery and Reinvestment Act (aka the Stimulus Bill) is the President's signature piece of economic policy in his first two years. A massive $787 billion collection of expenditures and tax cuts spread over the first three years of his term, is more or less defines his economic approach in his first term. The reality is that most of the spending associated with that bill, which has, in a lot of ways, faded from public attention, is yet to take place. Here are the latest stats on the spending associated with the bill:
Spending: $236B out of $499B (47% complete)
Tax Cuts: $163B out of $288B (56% complete)
Total: $399B out of $787B (51% complete)
That's right, the stimulus bill is just barely half executed. And it was designed that way, not just as a short-term shot in the arm (which is what people typically think about when they think stimulus), but as a multi-year, multi-tiered approach to driving economic growth. Big tax incentives on the front-end for things like Cash for Clunkers or the First-Time Homebuyer Tax Credit to spur sales of cars and homes. By the way, remember how everyone on the right said Cash for Clunkers simply pulled forward sales that would have otherwise occurred later an that the auto industry would be back in the doldrums after it expired? Checked the stats lately? Auto sales are now up 25% year over year WITHOUT the credit. So, it's hard to argue the effectiveness of the short-term incentives.
Tier two was infusions of entitlements and state cash to stave off massive state budget cuts that would drive unemployment and to put cash in the hands of the unemployed and needy that would immediately be reinserted into the economy driving growth. This stage has had mixed success, with states staving off cutbacks....until now that the money is running out. Perhaps the money served it's purpose by saving those cuts until the economy was on more solid footing, but there is no doubt that there are state budget crisis everywhere right now that have to be solved.
The third stage, which we are really now entering in earnest is about infrastructure spending. Road and bridge upgrades. Green energy programs. Things which create jobs but are also investments in the future of our economy. There is road work upgrading I-295 near me (a badly needed project.) Solar panels have gone up on light poles all around me, provided by private industry, but subsidized by stimulus funds. This is all good stuff, whether or not it is enough to immediately bring down the unemployment rate. In fact, my criticism at the time is that I wished far more of the bill were devoted to infrastructure spending (only $275B out of the $787B packaged was devoted to such items, scarcely over a third.)
So with a clear approach already laid out and in progress, why is congress passing silly little $48B (and yes, $48B is tiny in the scheme of our economy) jobs bills? Because they are trying to show that they are doing "something" about the persistent near 10% unemployment rate and the 8+ million jobs lost in the recession. The truth is that the latest bill, a collection of small tax cuts which is about 50% offset by some tax hikes, does little either way to impact the economy. But it looks like action. And as mad as people still are about unemployment, they want to show some action.
The latest "jobs bill" is a small aside that will be quickly forgotten. But, keep the faith, unemployment will come down. The fundamentals are returning to the economy, with economic growth taking place and good employment growth over the past two months, for the first time since the recession started. But it is now obvious to me that it will take a painfully long time to get down to an acceptable level of unemployment (I define "acceptable" as somewhere around 7%, "good" as somewhere around 5%.) We'll see if the American people have that kind of patience. I suspect not.
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